In The Daily Fix, Crikey taps into the wisdom of experts and community leaders to find solutions to problems. This week: climate change
Tackling climate change requires putting a price on carbon. A carbon tax is the best way to do that.
At the same time, households need to be compensated for increased prices, and exporters must not be disadvantaged.
The Australian Carbon Dividend Plan that Rosalind Dixon and I have proposed meets all these objectives. It involves a $50 per tonne tax on carbon, which is rebated evenly to every voting-age Australian citizen.
Exporters to countries without a comparable scheme receive a rebate for taxes paid, and imports from such countries are charged a fee.
The Climate Leadership Council’s plan which inspired ours is supported by four former US federal reserve chairs and 27 Nobel laureates.
Richard Holden is a professor of economics at the University of New South Wales.